Affordable Care Act ("Obamacare")

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The Affordable Care Act (ObamaCare):
Where Are We?
March 2010
March 2012
Department of Family & Community Medicine Grand Rounds 4/25/12
Dan Derksen MD, Professor
Department of Family & Community Medicine
[email protected]
The Impact of Health Care Reform
in New Mexico
I.
II.
III.
IV.
V.
Affordable Care Act 2010 to 2014
Supreme Court of the United States
Coverage – U.S. vs N.M.
Medicaid & the Exchange
Forecasting Health System Change
Dan Derksen MD, Professor
Department of Family & Community Medicine
[email protected]
I. Affordable Care Act
Since 2010 in New Mexico:
•
•
•
•
900,000 with private insurance – no lifetime limits
120,000 kids w/ pre-existing conditions not denied coverage
10,000 < age 26 are covered on parents’ plan
NM Division of Insurance - rate review process
I. Affordable Care Act in 2014
• Mandates coverage (individual, employer)
• Expands Medicaid <133% Federal Poverty Level
• Subsidizes premiums 133 - 400% FPL on
state or federal exchange
• FPL family of 3 = $18,310
Sotomayor
Thomas
Breyer
Scalia
Alito
Roberts
Kagan
Kennedy
Ginsburg
Supreme Court of the
United States
Donald Verilli
US Solicitor General
Paul Clement
Former US Solicitor General
Supreme Court Hammer Time on Obamacare?
Supreme Court of the United States
Threshold – Is It Premature to
Act before 2015?
Anti-Injunction Act (PL 72-65):
• Disallows legal challenges to taxes until they are collected
• Penalty for not having health insurance to be levied in 2014
Prediction: 9-0 SCOTUS Vote that AntiInjunction Act does not apply
Mandate – Minimum Coverage
Provision, Severability
• Mandates that every American have health insurance
• Challenged by 26 states with Republican Attorneys General
• Questions mandate constitutionality and if the insurance
requirement can be severed from the rest of the law
• Affects guaranteed issue, community ratings for insurers
• Mandate spreads risk, mitigates insurer adverse selection
PL 111-148, PL 111-152
Is Medicaid Expansion
Unconstitutionally Coercive for States?
•
•
•
•
•
Covers all American adults under age 65 <138% FPL
100% paid for by federal government 2014, 2015, 2016
States eventually pay 10% of expansion costs
Requires states to expand or lose Medicaid funding entirely
Striking down Medicaid expansion endangers other federal
programs – education, transportation, national security
Are Past Politically Charged
SCOTUS Votes Predictive?
48% cases were decided unanimously (9-0) in 2010
20% were along liberal/conservative divide (5-4)
Scalia & Thomas voted most often to invalidate legislation
Example: 5-4 Citizens United (2010) – extends 1st
amendment free speech rights to corporations, unions
• For: Roberts, Kennedy, Scalia, Alito, Thomas
• Against: Stevens, Ginsberg, Breyer, Sotomayor
http://sblog.s3.amazonaws.com/wp-content/uploads/2012/04/SB_votesplit_040512.pd
Will the Supreme Court Run the ACA off the Road?
If you don’t know
where you are going,
you might end up
someplace else
Yogi Berra
Supreme Court of the United States - Prediction
Medicaid
Expansion Mandate Severability
Alito
No
No
No
Breyer
Yes
Yes
Yes
Ginsburg
Yes
Yes
Yes
Kagan
Yes
Yes
Yes
Kennedy
Yes
No
Yes
Roberts
Yes
No
Yes
Scalia
Yes
No
No
Sotomayor
Yes
Yes
Yes
Thomas
No
No
No
Total Y/N
7-2
4-5*
6-3
*Mandate struck down, along with guaranteed issue, community rating
042512 Dan Derksen MD
Can the U.S. Afford the Status Quo?
Status Quo: 60 million uninsured by 2020
U.S. Per Capita Cost Is Higher
$9,000
$8,000
$7,000
$6,000
$5,000
$4,000
$3,000
$2,000
$1,000
$0
OECD
Canada
Switzerland
OECD Health Data 2011 at http://www.oecd.org/dataoecd/6/28/49105858.pdf
Accessed 4/2/12
OECD - Organisation for Economic Co-operation & Development
U.S.
U.S. Life Expectancy Is Lower
82
81
80
USA
79
OECD
Canada
78
Switzerland
77
76
Life Expectancy
OECD Health Data 2011 at http://www.oecd.org/dataoecd/6/28/49105858.pdf
Accessed 4/2/12
Is There a Way Forward from Here?
HELP US!
What Are the Republican Alternatives?
Patients’Choice Act
Redirect $300b ESI tax subsidy
Create advanceable Tax Credits
Families $5,700/yr
Individuals $2,300/yr
Health Savings Accounts
Low-income: $5k debit card
Other Reforms
Create Medicaid Block Grants
Like 1996 AFDC Block Grants
Apply to All Means Tested Programs
ESI = Employer Sponsored Insurance
AFDC = Aid to Families with Dependent Children
http://online.wsj.com/article/SB124277551107536875.html
http://online.wsj.com/article/SB10001424052748704529204576257132397198332.html
Will States Have the Opportunity to Innovate?
By 2020 in U.S. with ACA:
• Reduce
uninsured by 30 to 33 million
• Residual uninsured 26 to 27 million
• Cover 20 to 23 million thru exchange
• Cover 16 to 17 m in Medicaid expansion
(100 million will be on Medicaid in 2020)
• Reduce employer sponsored by 3 to 5 m
http://www.cbo.gov/sites/default/files/cbofiles/attachments/03-13-Coverage%20Estimates.pdf
NM Health Status: Critical
1) Last
in access to health care &
prevention
2) 49th of 50 States in % Pop. Uninsured
3) Will experience 2nd highest decrease in
uninsured of states starting in 2014 (16%,
300,000 individuals) if ACA upheld
4) 260 NM deaths/yr due to being uninsured
State Scorecard on Health System Performance. The Commonwealth Fund 2009. http://www.commonwealthfund.org/Publications/FundReports/2009/Oct/2009-State-Scorecard.aspx
KFF State Health Facts. http://www.statehealthfacts.org/comparetable.jsp?ind=126&cat=3
Buettgens: Health Reform Across the States. March 2011. http://www.urban.org/uploadedpdf/412310-Health-Reform-Across-the-States.pdf
Dying for Coverage in New Mexico. 2006 http://familiesusa2.org/assets/pdfs/dying-for-coverage/new-mexico.pdf
Payer Source – Health Insurance in NM
Payer Source
Medicaid
Uninsured
Medicare
Other Public
CHAMPUS Tricare
Subtotal Public
Total Pop. NM
# New Mexicans
550,000
450,000
300,000
150,000
50,000
1,500,000
2,000,000
Daniel Derksen MD 4/25/12
New Mexico Health Care Reform
In 2014, about 135,000 uninsured New
Mexicans will be covered:
•
•
80,000 through expansion of Medicaid
55,000 in the Health Insurance Exchange
By 2020 in New Mexico up to:
• 750,000
will be covered via Medicaid
• 250,000 will be eligible for HIX coverage
• 100k to 150,000 will still be uninsured
• Will increase health system demand 25%
• Pent up demand highest in first 24 months
Health care official resigns over
perceived lag in progress
Trip Jennings | The New Mexican
Posted: Friday, March 23, 2012 - 3/24/12
State Slow Planning Insurance Exchanges
An Albuquerque doctor tasked by Gov.
Susana Martinez's administration to help
administer a cornerstone of the nation's
federal health care law in New Mexico
resigned this week, citing resistance from top
officials to move forward.
Dr. Dan Derksen resigned Monday as director
of the New Mexico Office of Health Care
Reform. In an interview Friday, Derksen, a
lifelong Republican, said there had been a
shift in policy and that he had lost the battle
over "policy approach and implementation"
within the administration about the timeline
for building a New Mexico health insurance
exchange, which is meant to help more
people obtain health insurance.
By Winthrop Quigley / Journal Staff Writer on Tue, Apr 17, 2012
Gov. Susana Martinez’s people insist they will implement a
health insurance exchange, as required by the federal
Affordable Care Act, despite the resignation late last month
of Dan Derksen.
He was just about the only senior official in the
administration who seemed to take the exchange
seriously.
The state’s commitment to the exchange is a tad difficult to
trust. Leaving aside the lack of any discernible political
taste the administration has for the federal health care act,
the state has decided to delay work on a highly complicated
project that is supposed to be ready to enroll thousands of
people into insurance plans starting in October of next year.
If the governor really wants a working insurance exchange
in place before the federal law imposes one on New
Mexico, state government is going to have to work with far
more speed than it ever has.
No Help from NM Budget FY’13
• $5.61 B (3.6% increase) General Fund Spending
• FY’12 budget balanced (from $450 million deficit)
without increasing taxes
• Increase in Medicaid funding by $45m, insufficient
to pay for anticipated baseline growth in program
http://www.nmsu.edu/~legislat/documents/1-5-12-fy13-exec-budget.pdf
Daniel Derksen MD 4/25/12
Exchange Timelines Required of States
July 2011
9/29/11
11/29/11
March 2011
3/30/12
June 2012
Fall 2012
1/1/13
10/1/13
1/1/14
1/1/14
1/1/15
Proposed HIX rule released
Level 1 NMHIX establishment grant submitted
CMS Notice of Award $34.3 million to NM
Final HIX rule published
Level 2 proposal due (or 6/30/12)
Supreme Court ACA Rulings
Complete, submit CMS HIX certification forms
CMS Certifies NMHIX “ability to operate”
Begin enrolling for NMHIX (or federal HIX)
Medicaid Expansion (175,000 eligible)
NMHIX Full operations
NMHIX Fiscally self-sustaining
Income
below 133%*
Medicaid/CHIP
*5% Income Set Aside
Thus <138%
** Income
>133%
**Income 133200 %
State Basic Health
Plan (optional)
Participating small
employers/employees
Individual Health
Insurance Exchange
Income 133400%
Subsidized
Small Business Health
Options Program Exchange
Income
>400%
Unsubsidized
Daniel Derksen MD 4/25/12
Patients
Office Staff
Improved
Outcomes
Physicians, Providers
Community
Reforming the delivery, payment
& education systems
Vision 2020
Practice
Organization
Coordinated
Care (ACO)
Meaningful
Health IT
Use of EHR
Medicare, Medicaid
Performance
Patient
Measurement
Experience
Public Reporting
RWJ AF4Q
Press Ganey
Family Medicine Foundation
Primary Care
Daniel Derksen MD 4/25/12
As any change must begin
somewhere, it is the single
individual who will experience
it and carry it forward.
The change must indeed
begin with an individual;
it might be any one of us.
Carl Jung
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